A fierce political battle is emerging over how Americans buy their guns.
A move by Visa and other major credit card companies to identify purchases at gun stores has inflamed Republican lawmakers, who warn that it will lead to widespread corporate surveillance and the suppression of Second Amendment rights. And they’re poised to make a campaign issue out of it.
The new merchant code would identify retailers that primarily sell firearms and ammunition. While it stops short of pinpointing what’s been purchased, Democrats and activists pushing for gun restrictions say it will help law enforcement spot suspicious transactions that contribute to mass shootings and illegal firearms trafficking. Those efforts became even more urgent after multiple killings at a Buffalo, New York, grocery store where 10 people died, and an Uvalde, Texas, elementary school where 19 children and two teachers were fatally injured by a shooter.
With just over six weeks to go before the midterm elections, GOP officials are seizing on the collection of gun store sales data as an example of what they term “woke capitalism,” opening a new front in the fight over the role businesses should play in driving social policy.
“Progressives are already cheering that this will be a huge step forward in monitoring suspicious gun purchases,” Rep. Roger Williams (R-Texas) said in a House hearing on Wednesday. “Anyone who is against the rights of gun owners will want [financial] institutions to flag every single transaction with a gun [code] to law enforcement.”
State officials are weighing in, too.
Environmental, social and governance — or ESG — policies have “been weaponized in a way that is very concerning to me,” said Florida’s Chief Financial Officer Jimmy Patronis, a Republican who’s seeking reelection. Patronis earlier this week threatened the credit card companies with the specter of GOP-led legislation targeting their operations if it’s determined that the code has “a chilling effect” on firearm purchases.
“I see it going as far as we need to take it. [Even] if we need to deplatform a financial institution doing business in the state of Florida because of their harm or irreparable harm they’re doing to some of these companies,” he said in an interview.
Earlier this month, Amalgamated Bank — a union-owned institution that’s become a go-to bank for Democratic campaigns — successfully petitioned an international standards-setting body to adopt the new merchant code for gun stores. Credit card companies had resisted those efforts for years, but after the International Organization for Standardization signed off on it, the companies said they had to comply.
Leaders from both parties have grown increasingly aggressive in using their power — and their financial resources — to cajole corporations into adopting practices that adhere to their respective ideologies. Those often conflict.
For every blue state pension fund that charges ahead with climate-conscious investment initiatives, Republican leaders in states like West Virginia will halt public contracts with big banks that no longer finance coal.
Credit card companies and commercial banks are now caught squarely in the middle of a similar dynamic around when it comes to gun store purchases. The companies are not happy about it.
“We do not believe private companies should serve as moral arbiters,” Visa said in a company blog post published in response to the ISO’s decision. “A fundamental principle for Visa is protecting all legal commerce throughout our network and around the world and upholding the privacy of cardholders who choose to use Visa. That has always been our commitment, and it will not change with ISO’s decision.”
American Express and Mastercard have made similar points. Hundreds of other types of retailers, including florists and mobile home dealers, already have their own dedicated codes.
But the code only gives financial institutions insight into where a purchase was made — not the items that were purchased. It won’t preclude legal purchases of firearms, nor will it serve as the sole reason behind the blocking of any individual transactions.
The code will provide financial institutions with a new tool to identify suspicious transactions made by consumers at gun stores since the merchant categories show up on buyers’ credit card statements.
The CEOs of America’s largest commercial banks, which ultimately handle those payments, echoed the points by the credit card companies in congressional hearings on Wednesday and Thursday.
“We cannot be involved in telling American citizens how their money will be used. That’s not our job,” JPMorgan Chase CEO Jamie Dimon told the Senate Banking Committee on Thursday.
Republican policymakers claim that the new code has politicized payment systems to the detriment of gun owners.
Two dozen Republican state attorneys general have already threatened the card companies with legal action over the new code. GOP lawmakers on the House Financial Services and Senate Banking committees fired off letters this week to Amalgamated Bank, the Treasury Department and the Bank Policy Institute — a lobbying group for big lenders — to signal their displeasure as well.
“Please resist the impulse to respond to the very loud noise in your left ears,” Sen. Kevin Cramer (R-N.D.) told the bank CEOs during Thursday’s hearing. “I’m happy to be the loud noise in your right ears.”
To Democrats and advocates lobbying for firearms regulations, those protests ignore a gun violence epidemic that kills tens of thousands of Americans annually. That’s why public pension leaders in New York City and California launched shareholder proposals earlier this year to force the credit conglomerates to support proposals to create a separate category for gun store transactions.
“There’s long been a merchant code for florists, but I don’t see Republican attorneys general objecting [to that],” New York City Comptroller Brad Lander, a Democrat who oversees the city’s pension system, said in an interview earlier this week. “I guess they don’t get big contributions from the florists.”
Having that code will create new ways for financial institutions to track suspicious activity — something they’re already obligated to do — and could thwart domestic terrorism and mass shootings, said Nick Suplina, senior vice president for law and policy at Everytown for Gun Safety, a group founded and financed by former New York City Mayor Michael Bloomberg.
Efforts to implement the code took root after a series of reports from The New York Times found that the assailants behind the Virginia Tech and Pulse Nightclub attacks, among others, had used credit cards to amass large stockpiles of guns and ammunition leading up to those mass shootings.
“It’s not just a question for policymakers and lawmakers to engage,” said Adam Skaggs, the chief counsel and policy director at Giffords Law Center to Prevent Gun Violence. “Business leaders, just like others, have a role to play.”
That line of thinking leaves out federal and state policymakers who are ultimately held accountable by voters, said Tennessee Attorney General Jonathan Skrmetti, a state Supreme Court appointee who spearheaded the GOP attorneys general letter.
“My worry is if boardrooms get more involved in politics, then politics is gonna get more involved in boardrooms,” Skrmetti said. “We are moving in a direction where everything is becoming political — and that’s bad.”